Following the recent news headlines regarding the Government’s decision to bring forward the ban on the sale of Petrol and Diesel vehicles (hybrids will continue to be available) from 2035 to 2030 (just ten years away), companies and individuals will have to change behaviours when purchasing cars.
As you have probably already seen, we have been talking about the advantages of a switch to pure EV’s for some time and the associated tax advantages of such a switch. Here are some of the main points:
- 100% First Year Allowances against profits chargeable to corporation tax (limited companies) on the full capital cost of the vehicle – typically with prices in the range between £26,000 and £150,000 with relief at 19% depending on choice of vehicle.
- 100% First Year Allowances on the cost of the installation of EV charging points.
- From 6 April 2020 a 0% Benefit in Kind for employees driving cars incapable of emitting CO2 (fully electric vehicles).
- Cheaper running costs.
- Range is improving with the market average being 200-350 miles on one charge.
Tesla were of course first to market with their fully electric vehicles and we have since seen most manufacturers bring out at least one electric vehicle to their range. This in turn is starting to make electric vehicles more affordable and offer much more choice. Vauxhall say they will have an electric derivative of all of their cars and vans available from 2023, and Ford followed suit recently, stating they will also have an electric derivative of their range available by 2025.
For any company car drivers currently driving petrol/diesel high emissions vehicles, not only could this mean a significant tax saving for a similar spec vehicle, it also helps to reduce carbon footprint.
We are very well placed to talk to you about this. Therefore, if you are looking into replacing high emission company cars and want to save some serious cash, please get in touch.
Paul Buckley, Associate